HOW DIGITAL CHAMPIONS
INVEST
By Michael Grebe, Michael Rüssmann, Michael Leyh, and Marc Roman Franke
I f you want to understand what sets
digital champions apart from digital
laggards, take a look at their investment
priorities. Champions invest aggressively in
digital efforts, devoting a sizable propor-
tion of funds to building a world-class
technology/IT function. They dedicate a
significant percentage of their workforce to
digital projects—and have ambitious plans
to expand their digital talent base and
upskill their existing workforce. And they
invest in pushing digital efforts to scale,
with what is now an increasing focus on
scaling up in data and AI.
These insights are among the findings of
BCG’s third annual survey on digital maturi-
ty. The study made use of our Digital Accel-
eration Index (DAI) to understand how com-
panies across industries and regions stack
up in terms of their digital evolution. We
asked decision makers at more than 1,800
companies in Asia, Europe, and the US to
assess the digital maturity of their company
along 35 dimensions, with those inputs used
to derive an overall digital maturity score.
(See the sidebar, “Our Methodology.”)
Our findings this year shed light on which
industries and regions of the world are
ahead in digital and illuminate how cham-
pions are positioning themselves to expand
their lead. Companies aiming to improve
their digital maturity should carefully
study how digital champions have honed
their competitive advantage and where
they are currently directing their invest-
ment firepower.
Digital Maturity by Industry and
Region
The 2019 survey revealed that financial
services and telecommunications are the
most digitally advanced industries, with
more than 25% of companies qualifying as
digital champions. In contrast, energy and
the public sector trail behind, with more
than 40% of organizations qualifying as
digital laggards. In the middle are compa-
nies in technology, automotive, manufac-
turing, insurance, and consumer and retail,
in order of declining DAI score.
Our analysis also included an assessment
 OUR METHODOLOGY
For our 2019 study, we surveyed 1,817
organizations across 27 countries in
Asia, Europe, and the United States to
estimate their digital maturity on a scale
of one to four in 35 dimensions. To
ensure comparability of responses, we
described the stage of maturity of each
dimension in terms of specific practices
and capabilities. We aggregated these
raw scores and converted the resulting
values to a 0 to 100 scale. We then
weighted the scores for each dimension
equally to determine each company’s
overall performance on the DAI. We also
calculated a DAI score for individual
dimensions and for groups of dimen-
sions that we call “blocks.”
Companies with a DAI score of 67 to 100
qualify as champions, while those with a
of industry performance across regions. In
Asia, the best-performing industry is finan-
cial services, while telecommunications is
the leading industry in both the EU and
the US. (See Exhibit 1.) The strength of
Asian financial services companies is not
surprising given that many players are digi-
tally native and that digital banking com-
panies such as WeChat are subject to less
stringent data privacy restrictions than
competitors in other parts of the world.
Some industries that are low scorers in oth-
er regions are high performers in Asia.
Consider consumer and retail. Although
the industry ranks second to last in terms
of digital maturity in Europe and the US, its
DAI score in Asia is roughly 10 points higher.
In the retail sector, online players in Asia,
such as Alibaba, are shaping the shopping
space more than their peers in other regions,
thanks to their innovative digital offerings. A
similarly big spread can be observed in insur-
ance, where insurers’ DAI score in Asia is 8
points higher, on average, than in Europe
and the US. This disparity is due to the fact
that Asian insurers have been more techno-
logically innovative, such as in digitizing the
customer journey.
Boston Consulting Group | How Digital Champions Invest
score of 43 or less are considered
laggards. Champions have an average
maturity level of at least three out of
four on all dimensions, whereas laggards
report an average maturity level of less
than two in 66% of the dimensions and
an average maturity level of three in 33%
of the dimensions. In this most recent
study, champions had an average DAI of
77, while laggards scored 28 on average.
We examined eight industries—automo-
tive, consumer and retail, energy,
financial services, insurance, manufac-
turing, technology, and telecommunica-
tions—as well as the public sector. Our
respondents were primarily senior
leaders—22% were C-level and 35% were
division leaders—and general managers
(43%).
In contrast, Asian telcos show comparatively
low digital maturity—a surprising finding
given that the telecommunications industry
has one of highest DAI scores worldwide.
Some 38% of telecom companies in the US
and 32% in Europe qualify as digital champi-
ons, while only 13% in Asia do. The below-
par performance of these companies in Asia
likely stems from regulations that have not
incentivized Asian telcos to upgrade legacy
technology—a gap that is now inhibiting dig-
itization efforts.
Champions Apply Digital Boost-
ers
Digital disruption affects every company
throughout the world. So the question is,
Why do digital champions digitize faster
than their competitors?
We have identified three levers, or “boost-
ers,” that digital champions have adopted
to a much greater degree than laggards
have—and the improvement in digital ma-
turity that they enjoy as a result. (See Ex-
hibit 2.)
•• Digital champions devote more than 5%
2
 Exhibit 1 | Financial Institutions and Telecommunications Companies Have the Highest DAI Scores

40 (low) 50 (medium) 60 (high)

DAI score

PUB AUT MAN

Asia
TEL ENG INS CON TCH FIN

CON INS TCH TEL

Europe
PUB ENG MAN AUT FIN

CON INS AUT

US
MAN PUB ENG FIN TCH TEL

AUT Automotive FIN Financial services PUB Public sector

CON Consumer and retail INS Insurance TCH Technology
ENG Energy MAN Manufacturing TEL Telecommunications

Source: BCG global DAI study 2019.

Note: Scores are the average DAI score from 0 (lowest) to 100 (highest) per industry in a region and across all industries.

of operational expenditures (OPEX) When it comes to the second booster—

annually to digital. Those that invest at
this level have a DAI score that is, on
average, 16 points higher than the score
of laggards that do not.
•• They focus more on digital talent, with
more than 10% of full-time-equivalent
(FTE) employees serving in digital roles.
The DAI score of champions that have
achieved this level of digital staffing is
11 points higher than that of laggards
that have not.
•• Digital champions are able to scale up
pilots and use cases to realize the
benefits of these digital solutions. Such
companies have a DAI score that is 9
points higher than that of laggards with-
out this ability.
While 72% of digital champions devote
more than 5% of their OPEX to digital, just
50% of laggards do. Interestingly, a larger
share of US champions (89%) are making
these necessary investments than their
Asian (75%) and European (65%) counter-
parts. These companies are investing pri-
marily in data, technology, and new-busi-
ness growth.
building a digital workforce—Asian compa-
nies lead, with 54% hitting the 10% level of
employees in digital roles. The US is sec-
ond at 51%, and Europe comes in third at
44%. Strong performance here is a major
reason that Asian companies boast the
highest score for the group of dimensions
that concern new ways of working, includ-
ing agile at scale and digital culture and
leadership.
The third booster—moving beyond use cas-
es and pilots to scale up digital solutions—
is essential for a digitally mature company.
Here again the US leads, with 48% of cham-
pions reporting that they have scaled up
pilots into fully operational solutions, com-
pared with 35% in Europe and 32% in Asia.
Beyond their weakness in terms of the digi-
tal boosters, laggards fall behind in execut-
ing their digital strategy. These companies
have an average DAI score of 38 in the
group (or “block”) of dimensions we call
“business strategy driven by digital.” (See
the sidebar for a fuller explanation of
blocks.) But their average DAI score is
much lower, at just 28, for the five blocks
that are central to executing a digital strat-

Boston Consulting Group | How Digital Champions Invest 3

 Exhibit 2 | Three Digital Boosters Are Critical to Success
INVESTMENT
Spending over 5% of OPEX on digital Staffing more than 10% of employees
projects, such as the creation of new in digital roles and on digital projects
digital business models
Companies
that apply
the booster 72% 50%
+16
Champions Laggards
Source: BCG global DAI study 2019.
egy: digitizing the core, building new digi-
tal growth opportunities, changing ways of
working, leveraging the power of data and
technology, and integrating into ecosys-
tems. This divergent performance is con-
sistent for laggards across all regions. Digi-
tal champions, in contrast, have compar-
able scores for the strategy and execution
blocks—a sign that they are able to both
devise and implement a digital plan.
Champions Direct Their Spend-
ing to Tech and IT
Champions understand the importance of
investing aggressively in digital—and, in
particular, the need to direct a significant
portion of those dollars to building world-
class technology and IT capabilities.
Our survey found that the average digital
maturity of champions across all relevant
dimensions of technology and IT, including
DevOps, cybersecurity, and Internet of
Things, is 78—far ahead of the average
score of 29 for laggards.
We also found that champions are posi-
tioning themselves to expand that lead.
They are directing 22% of their digital in-
vestments to technology and IT, while lag-
gards are investing just 16%, on average.
That relatively low level of investment
Boston Consulting Group | How Digital Champions Invest
TALENT SCALE
Scaling up and refining pilots into
operative solutions that deliver
digital’s full potential
52% 18% 35% 14%
+11 +9
x Average DAI point increase from applying the booster
could come at a price, as our analysis
found that laggards that make the most
progress tend to focus on both technology
and data.
From a regional perspective, US, Asian, and
European champions have comparable lev-
els of digital maturity—79, 78, and 77, re-
spectively—across all dimensions of tech-
nology and IT. But while European and
Asian champions are spending 25% of their
digital budget on technology and IT, US
champions are investing just 20%. That
means the lead US champions enjoy today
is likely to narrow as other regions work
hard to catch up.
Investment in technology and IT also var-
ies by industry. The technology industry
leads, directing 29% of the total digital bud-
get to technology and IT, with telecommu-
nications (23%) and financial services (20%)
rounding out the top three. Lagging indus-
tries, including energy (12%), insurance
(15%), and consumer and retail (15%), are
spending substantially less.
Champions Broaden and Deep-
en the Talent Pool
Many champions have more than 10% of
their workforce in digital roles, but their
ambitions are clearly much greater.
4
 Some 77% of champions plan to expand
their digital workforce by 20% or more over
the next three years. Just 43% of laggards
have similarly ambitious plans. Given that
laggards are starting from a low level—82%
have less than 10% of their staff in digital
roles—the talent gap will widen over the
coming years.
Companies do not rely solely on hiring, of
course, to build digital talent. They also in-
vest in upskilling their current workforce.
And here, too, champions are looking to ex-
pand their competitive advantage. More
than half (51%) report that they are plan-
ning to upskill in excess of 20% of their cur-
rent workforce, while only 29% of laggards
have plans to do the same.
Asian champions have outsized ambitions
when it comes to both hiring and upskill-
ing. More than 93% of these companies
plan to expand their digital staff by more
than 20%. Just 68% and 65%, respectively,
of champions in the US and Europe have
that target. Meanwhile, 58% of Asian cham-
pions plan to upskill 20% or more of their
workforce, compared with 44% of champi-
ons in the US and 47% in Europe.
Champions Scale Up Data and
AI Capabilities
Digital champions are already in the lead
when it comes to scaling up digital efforts
to transform themselves into truly data-
driven companies. Now they are putting re-
sources behind reaching scale in the in-
creasingly critical areas of data and AI.
Data, in particular, is an area where there
is generally much room for improvement.
When we rank all 35 dimensions of digital
maturity globally, “data strategy” comes in
at a respectable number 5. But “data gover-
nance,” which is a major driver of a suc-
cessfully executed data strategy, ranks
much lower, at 21 in Asia, 23 in Europe,
and 34 (second to last) in the US.
Laggards are especially far behind in data
governance: an average score of just 20,
compared with 79 for champions. This
59-point difference is the widest gap be-
Boston Consulting Group | How Digital Champions Invest
tween champions and laggards in all the
dimensions of digital maturity. There are
also large gaps in other data-related dimen-
sions, including “digital and data plat-
forms,” where the difference is 55 points.
To stay in the lead, champions must contin-
ue to invest in data-related capabilities,
which enable such core dimensions of digi-
tal maturity as personalization, end-to-end
customer journeys, and digital supply
chains.
Excellence in these areas is also a prerequi-
site to success in deploying AI. Here cham-
pions are well ahead. These companies are
not only talking about AI, they are deploy-
ing it aggressively. While 63% of champions
have adopted AI technologies—meaning
they have rolled out the technology and
leveraged its potential—only 23% of lag-
gards have done so. Some 35% of laggards
have not even started thinking about po-
tential use cases for AI.
Regionally, 43% of Asian champions have
adopted AI, compared with 35% of their
European and 34% of their US peers. (See
Exhibit 3.) Interestingly, we likewise found
a regional maturity gap when we looked
at the three dimensions that enable AI:
data strategy, data governance, and digital
and data platforms. Asian companies
score an average 6 DAI points higher than
US and European companies in these
three areas.
Another important factor is the availability
of AI experts. Many companies are making
the development of AI pilots and the con-
version of those pilots into viable business
offerings a high priority. To do this, compa-
nies need employees who are savvy in data
and analytics. Here, too, Asian champions
are ahead, with 40% having more than 10%
of their digital FTE employees dedicated to
AI. (See Exhibit 3.) Meanwhile, only 23% of
champions in the US and 20% of champi-
ons in Europe dedicate more than 10% of
their digital FTE employees to AI.
Globally, it is clear that laggards are likely
to fall further behind, with only 13% of
companies dedicating 10% or more of their
digital FTE employees to AI.
5
 Exhibit 3 | Asian Companies Lead in AI Adoption
Asian companies lead in
adoption of AI technologies
% %
Fully
35 34
43
Partly
43 40
44
Not at all 22 26
13
Asia Europe US
Q: How much have AI technologies been adopted?
Source: BCG global DAI study 2019.
Becoming a Champion
Digital champions have mastered the tran-
sition from a digital vision to digital reality.
Certainly the road to success will be differ-
ent depending on a company’s industry
and starting point. But all those with digi-
tal ambitions should take lessons from the
champions in three areas:
•• Aim for a world-class technology
function. Companies should steer
sizable digital investment dollars
toward building a leading tech/IT
function. That will not only position
them to leverage new technologies like
AI, the Internet of Things, and block-
chain to support new digital business
models, it will also create major
efficiencies in the core business—sav-
ings that can help fund the digital
journey.
•• Build a digital talent engine. Compa-
nies need a talent strategy that reflects
the demand for new roles and skills,
including data scientists and agile
coaches. They should develop a focused
digital recruiting strategy and a blue-
print for upskilling their current
Boston Consulting Group | How Digital Champions Invest
Asian companies dedicate
more FTEs to AI
>=10%
20 23
40
38 35
5%−<10%
39
0%−<5%
42 42
21
Asia Europe US
Q: How many digital FTEs are dedicated to AI work?
workforce to ensure that they have the
right talent—in terms of both technical
skills and the capabilities needed to
build and manage digital businesses.
•• Transform into a data-driven compa-
ny. Companies must invest in data
capabilities in order to digitize the
customer journey and develop person-
alized offerings, adopt powerful new
technologies such as AI, the Internet of
Things and blockchain, and cultivate
powerful ecosystems. Those that up
their game in data stand to capture new
revenue pools and drive a true digital
transformation.
Success in digital demands a clear and fo-
cused investment strategy. Companies that
are able to develop such a strategy can
drive a successful digital transformation—
and put themselves on the path to emerge
as champions.
6
 About the Authors
Michael Grebe is a senior partner and managing director in Boston Consulting Group’s Munich office.
He is the global leader of the firm’s work with the Digital Acceleration Index and the World-Class Technol-
ogy Function and is a member of its Technology Advantage operating committee. You may contact him by
email at grebe.michael@bcg.com.

Michael Rüssmann is a senior partner and managing director in BCG’s Munich office. He leads
DigitalBCG and the Technology Advantage practice in Central and Eastern Europe and in the Middle East.
You may contact him by email at ruessmann.michael@bcg.com.

Michael Leyh is a knowledge expert in the firm’s Düsseldorf office. He is an operational co-leader for its
work with the Digital Acceleration Index and is the leader of the IT benchmarking in banking topic. You
may contact him by email at leyh.michael@bcg.com.

Marc Roman Franke is a project leader in BCG’s Berlin office. He is an operational co-leader for its work
with the Digital Acceleration Index and is a member of the Technology Advantage practice. You may con-
tact him by email at franke.marcroman@bcg.com.

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Boston Consulting Group | How Digital Champions Invest 7